Travel insurance: What doesn’t my policy cover?

Don't get caught out thinking you're covered when you're not. A guide to common travel insurance exclusions

There is an old saying: “If you can’t afford travel insurance, you can’t afford to travel.”

While this saying does hold true in many cases, sometimes even if you can afford travel insurance and remember to buy cover, that policy is not worth the paper it’s printed on.

Why? Because you’ve intentionally or unintentionally breached a term or condition and have rendered your policy redundant.

Unfortunately, this is an all-too-common occurrence, which is why it’s important you read the product disclosure document (PDS) before buying a travel insurance policy. But the PDS can be confusing, with unfamiliar jargon and missing information. That's why we’ve created this guide to common travel insurance conditions and exclusions, along with useful tips for avoiding hidden travel fees.

The question is not always so black and white. Say you have to cancel your trip due to the death of a relative. Not only will you have to prove that they were an immediate relative, you’ll also need to provide your insurer with a death certificate. If that wasn’t already hard enough, there are also conditions (generally not laid out in the PDS) about whether or not the death was due to a pre-existing condition and also the age of the deceased.

Let’s get into specifics:

Alcohol

You’re not covered. That is to say, you’re not covered if you’ve drunk too much. But how much is too much? Unlike drink driving where there is a set limit, insurers have discretion when it comes to assessing your claim to determine whether or not alcohol consumption directly contributed to your claim.

Motorcycle and scooter use

Getting around on two wheels may be a time-honoured mode of transport for tourists in many countries, but did you know that you need to hold a valid licence either in the country you plan on riding in or back at home here in Australia? All policies also have a limit on the size of the engine the bike or scooter can have (generally not more than 125cc) and require that you were obeying the road rules (i.e. wearing a helmet).

Extreme sports and activities

Feel like running with the bulls? If so, you’re doing so at your own peril as insurers will not cover your medical bills should your rump be introduced to the pointy end of a steer (read: getting your arse gored by a bull’s horn). Other activities you won’t get cover for include BASE jumping, free climbing and hunting.

Luggage

While most travel insurance policies come with luggage protection, there are caveats that you need to be aware of. he biggest is that if you’re luggage is lost by your airline it’s up to them (not the insurer) to compensate you. You’re also not covered if you leave your luggage unattended and it’s stolen, which can include if you’ve left your bag unsecured in a hostel room.

Claiming

Hidden fees and savings tips

Don’t get travel insurance through your airline or travel agent. Want to pay more than you have to for travel insurance? Airlines and travel agents generally offer, for convenience,an option for their customers buy travel insurance. But you’ll pay for this convenience as travel insurance sourced this way can costing upwards of 50% more than going direct to the insurer.

Watch out for global roaming costs. If you’re taking your phone with you on your next holiday, make sure you’re aware of any global roaming charges. One way to avoid these charges is to buy a global SIM prior to travel or to look for a travel insurer that provides one free with their travel policy.

Beware of international money charges. Get your cash early and at the best rate, and don’t wait until you’re at the airport to change your AUD to whichever foreign currency you need. Look at getting a travel money card to save you from getting hit with foreign transaction fees.

Skip the taxi. Planning to get a taxi? Why not take advantage of the ride sharing service Uber? Do the research prior to travel and you can end up saving a large percentage of your travel costs.

Entry and departure taxes. Check if there is an entry or departure tax prior to your arrival at the airport and try to have that amount ready in cash just in case you’re travelling somewhere that doesn’t accept EFTPOS.

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